EXPERT VIEW | Cash Flow
Firstly, manual processes are extremely time-consuming for staff. Entering data is a slow process and as a company grows, so too does the time investment needed. Secondly, to have true visibility and control of spend, companies need a real-time view of their cash flow. If your spend is only being logged weeks or months after it has occurred in spreadsheets, how can you ever have a true picture of it? Simply put, you can’t.
This is where automation comes to the fore. By automating core spending functions such as invoices, businesses can achieve a timely and accurate view of cash flow. A web or mobile-based system can manage all invoices both sent and received, from purchase orders, e-invoices, paper invoices and supplier networks seamlessly, greatly reducing errors and the time input needed from employees.
Importantly though, it also collects valuable data – today’s equivalent of the business tarot card. Data is almost impossible to use if you are working from spreadsheets and paper documents as it would simply take too long for a human to gather and analyse the information. However, feed the data through a machine and it can provide insights into spend and cash flow that can be used to anticipate future spend, identify patterns and single out deviances, allowing for greater strategic planning. Businesses can therefore make informed decisions about when they need to save and when they should be investing, as opposed to hoarding cash indiscriminately.
But, with the right technology, finance leaders and business owners can open up insight into their cash flow and free up vital funds. It’s not quite future-gazing, but it’s as close as you can get without magic and it’s grounded in automation.
Use data to predict the future
Despite the fact that society continues to make advancements in technology, many businesses today still handle their financial processes with a combination of paper invoices, forms and spreadsheets. This is a problem for two reasons.
dofonline.co.uk
Plug the leaks from within the organisation
Of course, good cash flow doesn’t just boil down to having a firm grip on forecasting spend. It’s also vital that you have control of that spend too. Despite the fact that many companies are saving for the unexpected, money continues to leak – money that they need to invest and grow.
One of the main culprits for this is human error, especially with regards to admin issues such as duplicated invoices. A third of UK finance leaders admit to having
paid a duplicate invoice. It’s a cost many simply do not need. Rather than hoarding cash to cover these mistakes, business leaders should instead look internally to recover money that is otherwise being wasted. Automation can help – optical character recognition (OCR) technology and auditing centres, for example, can quickly process large amounts of invoices with almost 100% accuracy. These systems thoroughly analyse every single submission and invoice, flagging issues like duplicates invoices. It might seem like a small issue, but annually the cost of these can really add up.
Stop cash from being stolen
But leaks don’t just come from within. Businesses that adopt manual finance processes are a natural target for invoice-related fraud. Invoice phishing in particular, whereby scammers send numerous fake invoices hoping some slip through the net, can be extremely costly. Scams such as this are successful because the fraudsters behind it know that finance teams or business owners, are swamped under paperwork, trying to process every invoice by hand. It’s inevitable that mistakes are made and fake submissions are paid alongside the real ones.
Much like human error, fraud can also be greatly reduced through automation. While humans get bored, tired or careless – machines do not. It can spot fake invoices and flag them to management, and it can do it consistently, saving vital funds for the company, which can be used to drive the business forward.
Ultimately, the year ahead is set to be a bumpy one, but this shouldn’t mean businesses need to go into hibernation. In fact, it means the opposite. Rather than hoarding cash, business owners should be looking to adapt to a changing Britain and investing in their future.
There are no crystal balls, oracles or prophets to shine a light on the upcoming uncertainty – but with the right technology, businesses can have both visibility and control of their spend. And that means they can rest assured, regardless of what rears its head in the future.
DIRECTOR OF FINANCE DIRECTOR OF FINANCE 41
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52
